ONGC Willing to Spend $11bn at Farzad-B

The managing director of India’s ONGC Videsh Ltd said the consortium is ready to spend as much as $11 billion to develop a giant natural gas field south of Iran.

ONGC Videsh Ltd. has offered to invest as much as $6 billion on the Farzad-B field and spend the remaining amount to build a liquefied natural gas export facility, according to Narendra Kumar Verma, Bloomberg reported.

He added that the group is seeking a return of about 18 percent, and Indian companies are willing to buy all the gas exported from the project.

“We have given our best offer to them. Now, it is up to them to agree or not agree,” he said.

“We have told the Iranian authorities very clearly that some basic returns are necessary.”

Indian companies have been in talks with Tehran since 2009 for developing the Farzad B gas field, estimated to hold 21.68 trillion cubic feet (tcf) of gas in place, of which 12.8 tcf is recoverable.

With 137.6 billion barrels of proven reserves, Iran has the world’s fourth-largest crude deposits. In terms of gas reserves, it is second only to Russia, with reserves estimated at over 33 trillion cubic meters (tcm).